Volatile global market to hit Irish farmers hard
Published 25/05/2016 | 02:30
Farmers could see earnings fall by up to a fifth this year as prices plunge on the world markets.
Teagasc revealed that family farm income rose 6pc last year to an average of €26,526.
There was a surge in cattle prices and a rise in dairy production, despite dropping milk prices in the first year after quotas were scrapped.
However, it still emphasises that the majority of farmers are dependent on the cheque from Brussels to pay their way, with the average payment standing at €17,000.
Teagasc economist Dr Thia Hennessy pointed out 2015 was a good year for production on farms with good weather conditions, lower fuel prices and the cost of animal feed down.
However, she said incomes are still expected to fall by 20pc-25pc this year due to the volatile world market. The first quarter of this year, compared with last year, saw the price of milk fall another 19pc.
"There may be signs the market is bottoming out but probably, unfortunately for Irish production, it is unlikely we will see any significant increase before the end of the main milk producing season. So overall, we'd be expecting the average milk price to be down between 15-20pc this year."
There was €800m invested by farmers during 2015, with €300m on dairy farms. However, Teagasc said it was surprised that two-thirds had no business related debt with many funding new investment from working capital.
It found debt on the one-third of the remaining farms was €60,607.